Profit leaps at guarantor loans provider Amigo following its London float earlier this year
Sub prime lender Amigo posted a 40 per cent jump in adjusted profit after tax today in its first results since its London flotation in June.
Shares were down 1.15 per cent this morning at 262p, which also marked a dip on their original price of 275p.
Revenue grew 40 per cent to £130.1m in the six months ended 30 September when compared to the same period the previous year.
Its net loan book grew 24 per cent to £671.7m and its number of customers increased 34 per cent to 207,000.
Amigo said today it had completed its first securitisation funding line of £150m, at a rate approximately 500 basis points lower than its bond funding.
Chief executive Glen Crawford said: “The securitisation is a key part in the business's strategic initiative in diversifying its sources of funding, maintaining strong liquidity and lowering overall cost of capital.”
Amigo provides loans to customers with poor credit if they can provide a guarantor with a better credit history who is willing to vouch for them and potentially be liable for the debt in the event of a default.
It offers loans at 49.9 per cent annual percentage rate.
The company, which was founded in 2005, said it is the UK’s largest guarantor loan provider with an 88 per cent market share.
The Financial Conduct Authority (FCA) said in July that it is is reviewing the high cost credit sector, which it said would include guarantor loans.
Amigo said today it believes the review "will focus on ensuring the guarantor understands their obligations” and said “we welcome the FCA's work in this area”.